How to build customer loyalty through positive payment experiences
Personalized interactions encourage policyholders to deepen their digital engagement with carriers.
Policyholders have diverse needs and preferences in both coverage requirements and interactions with insurance companies.
However, given that premium payments are their most frequent touchpoint and claims are the most sensitive, ensuring these processes are seamless and efficient is crucial for maintaining high customer satisfaction and loyalty.
Consumer expectations are also rapidly evolving in today’s fast-paced digital world. Customers expect simple interactions whether they’re buying retail, ordering food, or making and receiving payments.
What are the consequences of a poor payments experience?
When an inbound or outbound payment process is difficult, the policyholder experience suffers. This leads to a high volume of service calls, placing a significant burden on staff and agents to help frustrated policyholders manage issues created by outdated systems, often during an already stressful time. These negative experiences diminish policyholder loyalty, which is crucial to carriers.
Simple and convenient policyholder experiences during these frequent and sensitive touchpoints foster customer confidence and loyalty. Loyal customers are more likely to purchase additional products and services, refer new customers, renew their policies, and buy different types of insurance from the same carrier, thus increasing their lifetime value to the company.
Accessible, personalized interactions encourage policyholders to deepen their digital engagement with carriers by enrolling in AutoPay, opting for paperless billing, and digitally receiving premium refunds and claims payments. Simplifying these critical interactions increases customer comfort with other self-service capabilities, reduces internal workloads, and ultimately, enhances customer loyalty.
Changing the payment paradigm with innovative technology solutions.
Throughout my 25 years in insurance and information technology, I have witnessed how technological innovation has revolutionized the industry by enhancing operational efficiency, customer experience, and risk management. Staying attuned to policyholder needs and leveraging innovation to deliver simple, straightforward, and personalized experiences are crucial to drive customer satisfaction, loyalty, and retention.
Fortunately, there are solutions that help insurance companies deliver the innovative, customized experiences policyholders expect with minimal effort for the insurer.
At InvoiceCloud, we worked with a medical liability insurer whose lack of paperless billing was creating stress for their policyholders and internal team. Because people were forced to pay by check, the insurer was at the mercy of uncontrollable factors like the postal service — the delays of which often caused late and even lost payments. This insurer needed to introduce a digital alternative to address this issue, while providing policyholders support to ease the transition.
The organization knew that once these options were available and in use, they would reduce effort for everyone involved. They also knew a streamlined implementation would be crucial if they didn’t want to interrupt business operations.
According to research from McKinsey, 70% of organizations that attempt a complete system overhaul fail — and Couchbase found that they spend an average of over $4 million in the process. Even when implementations are successful, they can take up to 36 months to yield results. If the new options were rolled out piecemeal, over too long a timeframe, or without sufficient support, they would only lead to further frustration for all involved.
To address this concern, the insurer zeroed in on optimizing payments, rather than trying to transform themselves overnight. They chose InvoiceCloud based on our ability to support their team on the backend while providing an effortless inbound and outbound payments experience for their policyholders.
They also wanted a payments solution that would roll out updates instantaneously to all customers, without delays or additional burdens on their IT team. To fulfill this requirement, they turned to InvoiceCloud’s cloud-based SaaS (software as a service) solution.
Right away, the insurer introduced scheduled payments and AutoPay to increase flexibility and remove roadblocks to self-service. They even made it possible for policyholders to pay multiple invoices at once.
Following their implementation, this medical liability insurer saw an 82% increase in electronic payment adoption, saving policyholders time and stress, and saving their organization 27 hours per month that were previously spent managing the payment processing workload. Utilization of paperless billing increased by 154% across their customer base, saving the insurer $20,000 in printing and mailing costs as of 2024.
Knowing that a policyholder’s primary interaction with an insurance organization is through inbound and outbound payments, it’s imperative to provide greater flexibility at these touchpoints without compromising the quality of service.
Ultimately, the key for this insurer was finding a payments provider that didn’t just offer a sufficient solution but supported their team through implementation and the day-to-day utilization of that solution. For other insurers looking to transform their critical customer touchpoints, don’t be afraid to ask questions and hold out for solutions designed to deliver the positive digital payment experiences policyholders demand and deserve.
Julie Schieni is vice president of Financial Services at InvoiceCloud. She has more than 25 years experience in insurance and information technology. She has held leadership positions in software companies and property and casualty insurance carriers.
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